Stock traders warm up to Warsh as volatility index touches year-to-date low

The Cboe Volatility Index (VIX), which measures the price of 30-day options on the S&P 500 Index, fell to as low as 14.1.

Stock traders warm up to Warsh as volatility index touches year-to-date low

TL;DR

  • Odds of a Fed interest-rate hike in September rose to nearly 60% after Kevin Warsh's speech.
  • The Cboe Volatility Index (VIX) fell to a year-to-date low of 14.1, indicating trader optimism.
  • U.S. equities performed strongly compared to bitcoin and gold, which dropped significantly.
  • A low VIX suggests a vigilant Fed on inflation is seen as positive for the economy and stocks.
  • Longer-term equity volatility may be impacted by uncertainty around inflation and interest rates in the coming months.

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